Wynne accused of hiding $317M building buyout plan

Premier Kathleen Wynne's campaign tour rolled in to Centennial Colleges Culinary Management...

Premier Kathleen Wynne's campaign tour rolled in to Centennial Colleges Culinary Management International Program on Thursday. (JACK BOLAND/QMI Agency)

Antonella Artuso, Queen's Park Bureau Chief

, Last Updated: 9:05 AM ET

TORONTO -- The Kathleen Wynne government is quietly moving to buy a potential white elephant of a downtown building for $317 million and stuff it with government bureaucrats, Ontario Tories alleged Thursday.

Newmarket-Aurora PC MPP Frank Klees, who is not seeking re-election, released a number of confidential cabinet documents Thursday that point to a taxpayer-funded rescue of the 20-storey MaRS Phase 2 project. Completed this year at the corner of College St. and University Ave., those behind the project are struggling to attract tenants.

The documents state that since the Ontario government guaranteed a $234 million loan to construct the building -- and the project is in danger of defaulting due to a lack of tenants -- the recommended course of action is to purchase it outright in part to avoid damaging the MaRS brand.

"There's a reason this office space remains unleased even though the services of a globally well-known real estate entity was out there trying to fill that space," Klees said. "It's clear that the project was a failure from the outset, that there were cost overruns, they obviously paid too much for the property, they paid too much for the construction.

"We're not sure where all of that money went and who was directly responsible for the mismanagement, but now it's the taxpayers of this province who are going to pick up yet another $300 million-plus deficit liability all due to the lack of oversight and mismanagement on the part of this government," he added.

The MaRS Discovery District was launched by the previous provincial Progressive Conservative Party, with private sector investors, to create a space where innovation and research could be encouraged and harnessed to create jobs in the province.

Ontario taxpayers have made significant contributions to MaRS as a source of loans and tenants.

Wynne said she hopes Klees' comments don't derail the negotiations because the deal would be of great benefit to taxpayers by consolidating office space occupied by government employees.

"The Ontario government occupies more than 7,000,000 square feet of space in more than 100 buildings in Ontario. What this agreement would do, if it is finalized, would allow the consolidation of some of those government offices into a building that would be owned by the province and would mean that we would not be paying leases on that space," Wynne said.

Klees said Wynne and senior members of her government approved the deal that would see taxpayers buy out a private corporation involved in the project rather than face public embarrassment. There is nothing in the spring budget that mentions purchasing the office building.

According to the MaRS website, Phase 2 is a partnership between MaRS, the province of Ontario and a private international real estate developer.


Videos

Photos